Global Supply Chain Shocks
Think back on the start of the pandemic, when frenzied consumers piled supermarket trolleys high with toilet paper rolls, canned food and hand sanitizer. eCommerce platforms were not spared, either. “The demand in eCommerce [shifted] from non-essential to essential goods. More and more people were looking for essential goods like food, tissue, or things commonly found at home,” said Achmad Zaky, founder of Indonesian online marketplace Bukalapak. McKinsey found that as consumers prepared for a prolonged period of financial uncertainty, they intend to continue shifting their spending largely to essentials, such as grocery and household supplies.
Miss Fresh, on the other hand, chose the route of building warehouses instead of physical stores to increase efficiency and to reduce cost. For physical stores, the delivery radius ranges 500 metres to 1 kilometre, whereas a warehouse covers 1 to 3 kilometres. On top of that, the rent is a third of a physical store, with increased capacity for storage - making a warehouse 10 times more efficient and advantageous.
The unexpected demand surges for daily necessities, masks and personal protective equipment shed light on the weaknesses of the global supply chain. Traditional methods for managing supply chain risk usually rely on knowing how any potential event can disrupt your business operations. But no one predicted the scale, intensity, and length of COVID-19.
Food manufacturers had difficulty sourcing for raw materials from overseas, and machine-made products were favoured over handmade ones to account for labour shortages and safe distancing regulations. The key lessons learnt were the importance of diversification of supply chains, as well as the urgency to bring the business online.
But, a silver lining has also emerged - businesses springing up to meet demand forecasting needs for the food industry, which have accelerated because of the pandemic. It will be interesting to see how these new technologies can work to dramatically improve visibility across end-to-end supply chains and help cushion the impact of future crises.
Live, Work, Play, Learn...Differently?
The way we live, work, play and learn was altered, and some behaviours we adopted might stay on for the long-term.
“On the enterprise side, we always assumed that we would need to travel three hours from Shanghai to Guangzhou to have board meetings,” said Jenny Lee, Managing Partner of GGV.
But now, she finds these travel trips non-essential. “With online video conferencing, I find that I can do more. So that’s a heavy change in the way we conduct businesses. We save more on expenses and time.”
“COVID-19 exposed many inefficiencies and many things that we don’t actually need. For example, using Zoom [for my meetings]; now everyone is on time and everything gets done efficiently in one hour,” shares Zaky, when asked how he was coping with the pandemic.
Over at schools, scores of students were stuck attending classes online, when previously parents would have preferred “not to have their kids go online because of all the [distractions] and games,” says Jenny. With the return to schools not given a full green light, schools and colleges have been rolling out virtual instruction and online learning. However, it seems not all institutions were primed and ready to go.
The Edutech industry is set to be worth US$252 billion by the end of 2020, yet its current value sits only at 5.4% of the entire education section. The lack of adoption of education technology solutions in schools everywhere has been sorely highlighted by COVID-19. But to really adopt Edutech, it’s not enough to just conduct classes on Zoom - online learning needs to be embraced holistically and in an interactive way.
It’s something that Vamsi Krishna, CEO and co-founder of Vedantu, knows a thing or two about. Vedantu is an Indian online tutoring company, and its concept doesn’t just replicate the offline tutoring experience with an online one. Each live online class has quizzes and interactive content, with data that quickly informs the teacher(s) in the class on how each student is responding. This enables them to respond better and faster to each student, capturing their pain points and highlights in each lesson.
Compared to the current landscape, traditional schools and learning institutions have some ways to go, and the inertia to fully adopt edutech can be understood - initial costs could be expensive and require internal stakeholders to radically change how they think about teaching. But with the end of the pandemic nowhere in sight, perhaps it’s time to start seriously thinking about it.
The collective health of a society has never been so fragile and vulnerable during this time. One person infected with the virus can have a devastating effect on their loved ones and the community they live in.
In the long-term, this pandemic poses a “huge reminder that there is still a lot of work that needs to be done, whether it’s addressing and attacking viruses like Ebola, SARS, or today COVID-19,“ shares Jenny.
One of the key things it added pressure to was the demand and adoption for digital healthcare solutions.
Some of these digital health solutions could be seen as a temporary band-aid to the stresses on the healthcare system, but insofar as changing mindsets and behaviours, the effect on the ecosystem is likely to be long-term. Healthcare stakeholders like pharmaceutical companies, medtechs and healthcare providers will be forced to confront new ways of working, and accelerate broader digital transformation in the industry.